LG Autonomy Push Gathers Steam as States Retain N7.43tn Council Funds
Support is mounting for President Bola Tinubu’s move to enforce direct allocation of funds to local governments, as fresh data show that state governments retained control of at least N7.43tn meant for councils despite a Supreme Court ruling granting financial autonomy.
The Association of Local Governments of Nigeria and the National Union of Local Government Employees have publicly backed the President’s position, urging full implementation of the July 11, 2024 judgment that declared it unconstitutional for states to manage funds belonging to local councils.
President Tinubu raised the issue during the 15th National Executive Committee meeting of the All Progressives Congress at the State House Conference Centre in Abuja, where he called on governors to comply with the apex court ruling. He warned that continued non compliance could force him to issue an Executive Order to ensure that allocations from the Federation Account are paid directly to local governments.
The Supreme Court, in a unanimous decision by a seven member panel, held that funds meant for local governments must not be retained or administered by state governments. It also ruled that the use of caretaker committees by states amounts to unlawful control of local councils and violates the 1999 Constitution.
However, findings show that 18 months after the judgment, implementation remains largely stalled. Local government allocations continue to pass through state governments under the State Joint Local Government Account system, amid delays and disagreements involving the Central Bank, state authorities, councils and other agencies.
An analysis of Federation Account Allocation Committee disbursements, based on official statements from the Office of the Accountant General of the Federation, indicates that local governments were allocated N7.43tn between July 2024 and December 2025. The funds covered allocations to the 774 local councils from July to December 2024 and the entire 2025 fiscal year, even as the framework for direct access remained unchanged.
In the second half of 2024, councils received N2.08tn. Allocations rose sharply in 2025 to N5.35tn. Monthly FAAC data show that councils received N337.02bn in July 2024, N343.70bn in August and N306.53bn in September. Disbursements increased in the final quarter, reaching N402.55bn in December 2024.
The upward trend continued in 2025, with allocations of N361.75bn in January, N434.57bn in February and N410.56bn in March. By mid year, monthly allocations exceeded N440bn, peaking at N529.95bn in October 2025 before easing to N445.27bn in December.
Overall, local governments received N5.35tn in 2025 compared with N3.77tn in 2024, an increase of N1.58tn or about 42 per cent. The growth mirrored higher FAAC distributions to all tiers of government. Total allocations rose from N13.91tn in 2024 to N20.28tn in 2025, while total distributable revenue increased from N15.26tn to N21.89tn. Federal Government allocations climbed from N4.95tn to N7.61tn, while states received N7.31tn in 2025 compared with N5.19tn in 2024.
Despite the increased inflows, concerns persist that continued state control of council funds is limiting the impact of higher revenues on grassroots development.
Backing the President’s stance, ALGON Secretary General, Muhammed Abubakar, said the association supports direct deduction of local government funds from FAAC. He noted that the President addressed the governors directly and anchored his warning on the Supreme Court judgment, expressing confidence that they would comply.
He added that ALGON would support the President should he take further steps to enforce the ruling.
In Bauchi State, the NULGE President, Muhammad Yunusa, described the proposed Executive Order as a welcome development, saying it would bring relief to local government workers and strengthen accountability at the grassroots. He noted that despite the Supreme Court judgment delivered last year, financial autonomy for councils has yet to take effect.
Efforts to obtain comments from the Chairman of ALGON in Bauchi State, Mahmood Baba Ma’aji, were unsuccessful as of the time of filing this report.
Meanwhile, the Chairman of NULGE in Kano State, Comrade Ibrahim Muhammad, expressed cautious optimism, saying that while discussions on direct allocation are yet to commence, the state government has continued to release funds for projects and settle outstanding debts owed to civil servants. He said he remains hopeful that Kano State will fully comply with the President’s directive on local government autonomy.
